Tuesday, July 27, 2010

Thursday, July 22, 2010

Procrastination, it turns out, is an essential skill that we need to develop to accomplish things.

Most people that accomplish something, almost always achieve it by procrastinating lots of other things. So it's not procrastination that is bad, it's procrastinating the wrong things that needs to be fixed.

In the past, I've gone through phases where I do not have any goals (drifting) or phases where I have too many goals (distracted).

Without something to accomplish (drifting), I was procrastinating everything, and with too many things to accomplish (distracted), I was doing only the fun or easy things (instant gratification) and procrastinating everything else.

Here are the thumb rules I use now to figure out what to procrastinate:

Choose goals that you want to accomplish. Without goals you won't get anywhere. Duh!

If you came up with a lot of goals, get real and trim it down to 2-3 goals at max. If you think about it, most people that you look up to as achievers, have a single minded focus on only 1 or 2 goals.

Once you've chosen what you want to accomplish, procrastinate everything that does not help you accomplish it.

Life is too short for you not to get distracted by other things that give you instant gratification every now and again, so if you feel like breaking these rules sometimes, go for it - it doesn't mean you have to do it again tomorrow. Break it, enjoy it and move on.

Tuesday, July 20, 2010

There are two ways to make enough money to do the things that you want to do:

Make more money

Spend less money

A lot of people choose to make more money, which is fine if you plan on achieving it by increasing your Passive Income. The problem is, that people choose to make more money by trying to increasing their Active Income. This is a vicious circle.

Active Income requires a linear investment of time. If you want to make more money, you need to spend more time, and when you stop spending time towards making money, well, you don't make any. The more time you put in, the more stressed you get. The more stressed you get, the more money you need to spend to deal with it and maintain your new lifestyle, which in turn leaves you with not enough money. Sound familiar?

The approach of spending less money is chosen by very few people and is an option that almost no one thinks about. It forces you to really think about what you want to do with your life and choose a lifestyle that will allow you to accomplish that.

Monday, July 19, 2010

Financial independence is not about having more money, it's about having more time. More time to do the things that you want to do.

You only get a finite amount of time to spend in this life and with each passing moment, your time runs out. When you understand this fact of life, you realize that time is actually more valuable than money.

So, what do you want to do with your time?

I for one, want to do many things and travel the world, and one way to achieve this time and location independence would be with Passive Income, an income received on a regular basis, with little or no effort required to maintain it, i.e., money received with a non-linear investment of time.

Passive Income is the opposite of Active Income, an income that is received with a linear investment of time, e.g., charging by the hour like in consulting, working for a monthly salary or selling stuff (handicraft, food) you create by hand. Since your directly trading time for money, if you stop investing the time, you stop making money.

From the above, it should be obvious that focusing on Passive Income is a better investment of the finite time you have.

Sunday, July 18, 2010

Increased inefficiencies result in greater viscosity; you need to put in a lot more effort to get something done.

Dealing with these inefficiencies (processes) generates a lot of busy work, work that is time consuming but not valuable.

Busy work dilutes focus and results in even further inefficiencies and the vicious cycle continuous till you end up with individual goals that are orthogonal to the companies goals.

Everyone in the company has a different context and is dealing with a different level of abstraction. Assuming that transparency is the key to keeping people aligned misses the point that the goals need to be communicated differently to different individuals within the company. This is a very hard problem to solve.